When consumers' purchasing power decreases, the economy will experience a period of
A. contraction.
B. expansion.
C. containment.
D. emergence.
A. contraction.
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If the amount of high-powered money were 100 and the bank reserve holding ratio was 0.25 then the maximum stock of deposits would be (assume that citizens prefer to keep 10% of their money as cash)
A) 100/0.25 times 1.1 which is 440. B) 100/0.35 which is approximately 286. C) 100/0.35 times 1.1 which is approximately 314. D) 100/0.10 which is 1000.
If the minimum efficient scale of production is small relative to the size of a market, then
a. the industry will tend to be highly concentrated b. there will be much strategic interdependence among the sellers in the industry c. the industry is unlikely to be an oligopoly d. it is more likely that sellers in the industry will successfully collude e. there will be much merger activity in the industry
The accompanying figure shows Becky's daily production possibilities curve for dresses and skirts.
Point T is:
A. both attainable and efficient. B. attainable. C. efficient. D. neither attainable nor efficient.
Economics can be defined as the study of
A. For whom resources are allocated to increase efficiency. B. How scarce resources are allocated. C. How society spends the income of individuals. D. None of the choices are correct.